Why IndusInd Bank Shares Are Down Despite Nifty Bank Hitting an All-Time High

On April 22, 2025, Nifty Bank touched a new all-time high, but IndusInd Bank shares slipped over 3% amid news of a second forensic audit.

On Tuesday, April 22, 2025, Nifty Bank reached a fresh all-time high of 55,756 at 10:17 AM. Most of its constituents were trading in the green. However, IndusInd Bank stood out, falling over 3% despite the broader rally in the index.

The stock has been under pressure since March, following the discovery of financial irregularities in its derivatives portfolio. An internal review by the bank estimated a negative impact of 2.35% on its net worth as of December 2024.

The Reserve Bank of India (RBI) extended CEO Sumant Kathpalia’s tenure by just one year, further fuelling concerns about leadership stability and internal governance.

In response, the RBI issued a statement reassuring stakeholders. It said, “The bank is well-capitalised and its financial position remains satisfactory. As such, there is no need for depositors to react to the speculative reports at this juncture. The bank’s financial health remains stable and is being monitored closely by the Reserve Bank.”

This statement temporarily calmed investor nerves. IndusInd Bank shares recovered to reclaim the ₹800 mark and partially closed the gap created on March 11, 2025.

However, on April 22, the stock again slipped below ₹800, down more than 3%. This came after reports surfaced that the bank’s board had appointed Ernst & Young (EY) to conduct a second forensic audit. The investigation relates to a ₹600 crore discrepancy in the accrual of interest income within its microfinance portfolio.

This new audit will run parallel to an ongoing probe by Grant Thornton Bharat (GTB), which is looking into irregularities in the bank’s forex derivatives accounting.

EY has been tasked with reviewing possible operational lapses, identifying any fraudulent activity, and determining who may be responsible for the misreporting.

As of now, IndusInd Bank’s share price is down nearly 17% on a year-to-date basis and has underperformed the Nifty Bank index by a wide margin.

 Disclaimer: The article is for informational purposes only and not investment advice.